Figuring Out Who's to Blame for DeFi's Persistent Security Issues

Publicado en by Cointele | Publicado en

Is Ethereum to blame?Evidently, the Achilles heel of DeFi projects is bugs and vulnerabilities in the smart contract codes, but what or who exactly to blame for this? Is it the DeFi developers who don't properly test or audit code before launching their apps, or does the fault lie with Ethereum's architecture, meaning that little depends on platforms?

On one hand, as Brian Kerr, CEO of DeFi lending platform Kava Labs, previously told Cointelegraph, the Ethereum blockchain's architecture is not capable of responding to the security demands of the DeFi sector because testing possible bugs is almost impossible in the Solidity programming language.

Shayan Eskandari, a security engineer and auditor at ConsenSys Diligence, told Cointelegraph that most of DeFi hacks were preceded by changes made by developers shortly prior to platform launch.

In a conversation with Cointelegraph, Arnie Hill, CEO of Plutus DeFi - a full-stack DeFi aggregator - noted that most DeFi developers do not pay enough attention to security, as they are at the early stage of product development: "Today developers are paying more attention to the technical side and capitalization, focusing on how to build lending services on blockchain, rather than the security of smart contracts."

As the DeFi sector evolves, its developers should become exceedingly aware of the growing security risks and work to reduce them, according to Hill:."Scaling the market requires the use of more serious protection mechanisms and cooperation with regulators and auditors. At the end of the day, this is no longer just a network of DApps, but a multi-billion dollar financial market that is at the early stage of its development and hacks are inevitable, the same as it was with the digital banking industry some years ago."

According to the latest report published by research company Dgen in collaboration with an open-source DeFi protocol Aave, ever since DeFi projects have become hacking targets, the developers began working on sandboxes and clear frameworks for dispute resolution.

Audit, due diligence and insuranceSo, is there anything DeFi teams can do to mitigate security risks, given that there are many products that successfully maintain a high level of security for their own and user funds?

Will ETH 2.0 bring more security?Some believe that along with scalability, network upgrades will bring security to DeFi, while others say that Ethereum's 2.0 transition to the proof-of-stake algorithm will put the DeFi sector in even greater danger.

Based on research by analyst Tarun Chitra, Dragonfly Capital investor Haseeb Qureshi came to the conclusion that DeFi protocols run counter to the network security mechanism based on the PoS algorithm.

The problem is that funds locked in DeFi lending do not participate in staking and are a security.

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